Market crash??

[bcneil]

Wow I am sure I am not alone in having a very nasty last few days in the market?

I am not planning to do any selling and might be bargain shopping.

I anyone else? Or do you think its still going down significantly lower?

Everyone at my office thinks its a no brainer to get into oil right now.

 

[Justin Beaver]

This is just the beginning...gonna be worse than 2008,for sure.Huge bubble markets all over the globe starting to burst,debt crisis everywhere you look,none of the rampant corruption has been fixed since the last crash.
It was all just an artifically pumped up stock market by greedy Madoffs on Wall St who cashed out weeks ago and left everyone else holding the bag.

I just saw a stat that showed that almost 2 trillion dollars in paper wealth has evaporated in the last 3 trading days and the bloodbath has just started.Get out now if you can.

 

[Equity Market investor]

The difference between this crash and 2008 is .......North America banks are financially stable and with solid cash flow.........China is quite the opposite. For now that is.

This is great because P/E's will eventually be more inline with growth projections and yield. Besides, most markets have been stuck in a dull trading for a very long time. This is healthy and needed.

I'm using this great decline as a buying tool for long term blitz.

I wouldn't be surprised to see a strong bounce Tuesday.

 

[hornygandalf]

This has been coming for a while. It started with the Shanghai market crashing a few weeks ago, and the government there trying to prop it up. It worked for a little while, but is now on its downward slide again.
I've been moving most of my retirement money out of stocks over the last few months, and am practically all in cash at this stage.
I wouldn't be getting into anything just yet. The North American markets have potential to slide quite a lot further than they have. To give you some perspective, the Shanghai market is now down over 40% from its peak, and I'll be surprised if it doesn't have at least another 20% (from here) to drop, and maybe as much as another 40% (which will take it down about 67% from its peak). Put the North American 10% slide beside this and there could be a way to go yet. Then again, I might be wrong... but I did manage to liquidate ahead of 2008 as well as the current decrease (most of my holdings are in Asia rather than North America).
Currencies have also taken a hit. The New Zealand dollar slid 8%, and Canadian dollar slipped as well.

I wouldn't be surprised to see oil (and other commodities) go lower from here before they start to recover. There is an oil glut out there, which combined with the slowdown in the Chinese economy, means that low oil prices will last for a little while at least.

 

[hornygandalf]

I wouldn't be surprised to see a strong bounce Tuesday.

Maybe... but it could also be a dead cat bounce. I would be very cautious at this point. The North American markets have been pushed up by the Fed stimulus, and that money needed somewhere to go. It could also easily evaporate.

 

[Equity Market investor]

Maybe... but it could also be a dead cat bounce. I would be very cautious at this point. The North American markets have been pushed up by the Fed stimulus, and that money needed somewhere to go. It could also easily evaporate.

A dead cat bounce isn't a bottom until head n shoulders is created. Once that is established a base can be formed. For long term investors, like myself ( not day player) having cash at hand and buying on these extreme dips is crucial. But, remember to stick to a long term plan and keep foolish emotion aside.

Markets, eventually find their footing and when they do, it'll come back like a pack of rabid wolves. Especially if you hold blue chip companies with solid market share with great cash flow.

But I agree on your oil comment. I wouldn't be too shocked in seeing oil fall to the low $30 range. Maybe even the $20 range.

 

[felixthecat]

Everyone at my office thinks its a no brainer to get into oil right now.

If you mean physical oil, contango can kill you even if prices don't drop.

If oil companies, I'm buying, but I won't lose sleep if prices go down further. Shanghai can continue dropping in panic mode, US markets have room for decline, and oil sector will go down with everything else. It may be a good price for it long-term but no good reason to call the bottom.

 

[hornygandalf]

A dead cat bounce isn't a bottom until head n shoulders is created.

Not disagreeing with you on that. My dead cat bounce comment wasn't suggesting I saw this as a bottom. I think the likelihood is that it will continue to go lower. I have cash, but not buying yet.

 

[summerbreeze]

I would tend to agree, investor confidence is imploding knowing governments are in so much debt

consumer fear freezes spending and sales for companies drop, earnings drop, it feeds on itself and is all about psychology

major crash has been forecast for last 2 years by growing number of serious people, might be witnessing the tipping point right now

 

[hornygandalf]

Only thing I know for sure is that I'm no good at telling future.

Timing is the difficult part. It is easy to say the market is going to go down. Eventually it always does. Question is when. And then knowing when it is the bottom. Easy to say the market will go up again, but when? It could drop another 50% first before it turns. Personally, I think there is some major shit coming down the pipe (very major, as in civilization/societal changes), but when? I also like to look at historic patterns, such as Kondratheif (wrong spelling) waves... and some of the stuff coming out of socionomics (Elliot wave-type stuff). Tends to make me a bit of a pessimist...

 

[Lo-ki]

But I agree on your oil comment. I wouldn't be too shocked in seeing oil fall to the low $30 range. Maybe even the $20 range.

And still being gouged at the pump....

 

[Equity Market investor]

And still being gouged at the pump....

That is because of the tax system here in Canada and we are exporters mainly when it comes to this. Of course, that is what they want us to believe anyhow

 

[vanvisitor1]

Hey Wiinky, I am not good at telling the future either, but we are in luck! We can come to PERB (a well known site for investment ideas and advice) and someone named Justin Beaver can scream "the sky is falling!" and we will be saved! We can sell everything when prices are low since everyone else is and the sky is falling, then wait until prices get nice and high again so ywe know everyone wants those fancy stocks and then buy back in!

Or not.

 

[Equity Market investor]

I left the industry in 2006 and returned post-2008 crash/early 2009 (wow things had changed!! ) ... I'm not feeling incredibly optimistic right now :doh: I don't invest money in the stock market but I do keep an eye on it... I've learned from past experience it does affect my income.

For the average person - which is the majority - who cannot be properly diversified because he or she does not have thousands and thousands of dollars everyday to invest in the stock market. That person should seek advice from a pro, create a dollar cost average plan with ...PROPER DIVERSIFICATION .....and stick to a long term strategy . And by long term I don't mean 2 - 3 years. Long term in my mind is 10 years or more.

No one can predict the short term direction of the financial markets but one can have a long term plan. Just like real estate, the money markets over time DO escalate . Fact!

Diversify is key :thumb:

 

[badbadboy]

Wow I am sure I am not alone in having a very nasty last few days in the market?

I am not planning to do any selling and might be bargain shopping.

I anyone else? Or do you think its still going down significantly lower?

Everyone at my office thinks its a no brainer to get into oil right now.

After the last crash in 2008 I set up automatic sells on my accounts if the market dropped like it did this week. The only ones that take time to settle i.e. mutual funds, bonds etc take longer to liquidate.

I'm sitting on a cash balance at the moment. I am leaning towards resources but haven't put in any potential orders.

 

[Justin Beaver]

Hey Wiinky, I am not good at telling the future either, but we are in luck! We can come to PERB (a well known site for investment ideas and advice) and someone named Justin Beaver can scream "the sky is falling!" and we will be saved! We can sell everything when prices are low since everyone else is and the sky is falling, then wait until prices get nice and high again so ywe know everyone wants those fancy stocks and then buy back in!

Or not.

I'm not a trained economist but I can make sense of facts and statistics and don't see much reason for optimism in the markets right now.
I've been following this guys blog for several years and he and many experts in the finance world accurately called the 2008 meltdown and have been predicting a major "correction" for quite awhile now and it looks like it's starting to happen.If you're at all interested,read back several months or more and you can see what's led to this latest meltdown and why it's going to get much worse before it gets better.

http://theeconomiccollapseblog.com/

 

[felixthecat]

I'm not a trained economist but I can make sense of facts and statistics and don't see much reason for optimism in the markets right now.
I've been following this guys blog for several years and he and many experts in the finance world accurately called the 2008 meltdown and have been predicting a major "correction" for quite awhile now

That's the problem, they are crying wolf for quite a while. Sorry, this kind of "experts" are useless. They never tell you to buy, it's always doom and gloom. If you believed that, you'd stay in cash which earns stable 0% (or -2% if you adjust to inflation).

Compare to people who invested just before 2008 and stayed invested; they are sitting on a profit, despite the most unfortunate timing.
More realistically, people who invest regularly and stay invested would outperform nicely both these "experts" and majority of others who try to time the market.

 

[vanvisitor1]

Agreed Felix.

I have always marveled at how many people trust something because it is on the net.

If you are sick, see a specialist, not a self diagnostic internet medical site that says it might be cancer.

If you want to make money in the market, look at the people who have and emulate. You can start by reading everything ever written about Warren Buffett and his investment philosophies.

 

[hornygandalf]

Yep. Holding long-term is the way to go (with ironic tone).
Beginning of 1990 - Nikkei 225 was 37,189
Beginning of 2000 - Nikkei 225 was 19,539
Yesterday it closed at 17,806
The 1990 peak has not yet been reclaimed (market would have to go up over 100% to reach that).
And it took until April of this year before the 2000 peak was reached once again.

However, if someone had bought anytime during 2001-2005 or 2009-2013, they should be sitting on a healthy profit.
Long-term holding works if you AREN'T buying at the peak of the market when the masses usually rush in as part of the frenzy.

I would wait before adding any long-term holdings.

 

[hornygandalf]

.... You can start by reading everything ever written about Warren Buffett and his investment philosophies.

Buffett doesn't buy at the peak of the market. Part of investing long-term is also buying the right asset at the right price when there is real value.
Most retail investors fail to do that, and so don't see the same kind of returns... and sometimes their best option IS to sell out before it collapses to nothing (I've seen that happen in my own holdings when following the long-term approach... but then, I wasn't in the right assets).